What, the demographic of people who are ready to pay between $650$950 for Apple's current mobile phone, plus monthly contract fees? That demographic?
To be fair... if you are paying full price for the device, you are NOT also paying contract fees. Contract fees are what allow the carriers to subsidize the price down to $200-$500.
Nitpicking aside... I do agree with you that the target demographic is MUCH larger than people assume.
Somehow teens are coming up with $300 for their Beats headphones; why not $350 for an Apple Watch?